The dollar missed the 99 mark, and Fed Governor Milan called for a quick interest rate cut.

On October 16, in early Asian trading on Thursday, Beijing time, the U.S. dollar index was hovering around 98.49. On Wednesday, the U.S. dollar index fell for the second consecutive trading day. After falling below the 99 mark, it continued to decline and finally closed down 0.4% at 98.664, a new weekly low. U.S. bond yields consolidated at low levels, with the benchmark 10-year U.S. bond yield finally closing at 4.0335%, and the 2-year U.S. bond yield, which is sensitive to the Federal Reserve's policy interest rate, closed at 3.51%. Driven by expectations of an interest rate cut by the Federal Reserve and geopolitical tensions, spot gold continued its record-breaking rally, breaking through $4,200, continuing to hit new highs. It finally closed up 1.6% at $4,208.28 per ounce, a cumulative gain of nearly $200 this week. Spot silver rebounded strongly, approaching historical highs again, and finally closed up 3.11% at $52.99 per ounce. International crude oil is still hovering near five-month lows amid concerns about oversupply. WTI crude oil fluctuated near the 58 mark and finally closed up 0.05% at US$58.26/barrel; Brent crude oil finally closed up 0.26% at US$62.23/barrel.

Analysis of major currency trends

U.S. dollar index: As of press time, the U.S. dollar is hovering around 98.49. The Federal Reserve's Beige Book shows that U.S. economic activity has barely changed recently, and employment is basically stable. However, there are signs of weakness such as increased layoffs and low- and middle-income households cutting spending. The U.S. Dollar Index (DXY) continued its downward trend and fell below the key Fibonacci support level of 98.714. There are two reasons behind this: First, traders' expectations for the Federal Reserve to cut interest rates have continued to strengthen, and second, the rebound in global risk sentiment has boosted demand for high-risk currencies. Technically, the U.S. dollar index is currently testing key retracement levels, andThere is no immediate support before the 50-day moving average of 98.025, and market sentiment has clearly turned negative. Unless the dollar can find support at the 50-day moving average and rebound, the possibility of a further pullback to 97.412 remains. Especially in the context of continued consolidation of interest rate cut expectations and high risk appetite, this correction trend is more likely to form.

Euro: As of press time, EUR/USD is hovering around 1.1667. The euro broke above the 1.1600 mark for the second day in a row as the dollar came under pressure from expectations of a rate cut by the Federal Reserve and an escalation in the U.S.-China trade war. Although the political turmoil in France has begun to ease, the euro still lacks obvious positive factors. At the same time, the recent performance of EUR/USD is zgykf.cnparable to the rebound momentum seen after the euro zone announced a number of policies, which further enhances our strategic caution on the euro. Technically, the pair remains neutral with a bearish bias and continues to trade above and below the 100-day simple moving average (SMA) at 1.1644. The relative strength index (RSI) fell below the neutral 50 level on Friday, indicating that downside momentum is building. Immediate support is at 1.1600, followed by 1.1550 and 1.1500. A break below these levels would expose the August 1 cycle low around 1.1391. On the upside, resistance lies at 1.1650 and 1.1700. A break of the latter will open the path to 1.1800 and the July 1 high of 1.1830.

GBP: As of press time, GBP/USD is hovering around 1.3425. GBP/USD found room at the top on Wednesday, climbing back towards the 1.3400 level after a short-term decline, after the pair briefly challenged the 200-day exponential moving average (EMA) near 1.3290. A slew of moderately important UK economic data is due for release on Thursday, but the U.S. data calendar remains weak as the flow of key data releases is restricted due to the U.S. government shutdown. Technically, the technical view for GBP/USD suggests that unless buyers move above 1.3400 on a daily basis, the current rise may be short-lived. This could pave the way for a test of the 20-day simple moving average (SMA) at 1.3424, followed by a challenge at the 50-day SMA at 1.3474. Still, momentum remains bearish, as shown by the Relative Strength Index (RSI), which sits below the neutral level of 50. Conversely, if GBP/USD extends losses below the October 14 low of 1.3248, further downside targets the 200-day SMA of 1.3183.

YellowAnalysis of gold and crude oil market trends

1) Analysis of gold market trends

In Asian trading on Thursday, gold hovered around 4223.10. Gold's feat of breaking through $4,200 was due to a zgykf.cnbination of interest rate cut expectations, geopolitical tensions and economic weakness. This risk aversion storm has not only reshaped the global financial landscape, but also provided valuable opportunities for investors. With the possible consecutive interest rate cuts by the Federal Reserve and the continuation of international trade frictions, gold's march towards $5,000 will become even more determined. However, the market also needs to be wary of short-term overheating risks - if trade frictions show signs of easing, or the Federal Reserve releases a hawkish signal, gold prices may face correction pressure. But in the long term, against the backdrop of spreading global economic uncertainty, gold's "safe haven" role remains irreplaceable.

Technical: Technically, spot gold bulls show no signs of retreating and remain dominant even as momentum indicators show exhaustion of momentum. On the 4-hour chart, initial support is located in the $4180-4160 range, which highly coincides with the 21-period simple moving average (SMA). If gold prices pull back further, more buying may occur near $4,100, where the 50-period simple moving average provides further dynamic support. A pullback towards these levels is expected to attract new buying, thus sustaining the overall upward trend. However, some caution is required. The relative strength index (RSI) remains high around 77, indicating that the market is overbought. More importantly, the RSI indicator on the 4-hour chart has witnessed bearish divergence. This suggests that the current rally may enter a consolidation phase before a new round of gains may begin.

2) Crude oil market trend analysis

On Thursday’s Asian session, crude oil was trading around 58.28. Oil price gains were capped by escalating trade tensions and the International Energy Agency (IEA) forecasting a supply glut in 2026. Many officials from the Federal Reserve spoke during the day, and Mann, the monetary policy member of the Bank of England, gave a speech.

Technical aspect: From the daily chart level of crude oil, oil prices have fallen below the lower edge of the range, and the objective trend is downward in the medium term. Oil prices fell sharply in a single day, and the subjective and objective trend directions have been downward. The MACD indicator fast and slow line opens downward below the zero axis, indicating that short kinetic energy has the upper hand. The mid-term trend of crude oil is expected to be volatile and downward. The short-term trend of crude oil (1H) fluctuated and fell to a new low, hitting 57.30. The moving average system diverges downward and suppresses oil prices, and the short-term objective trend is downward.

Foreign exchange market transaction reminder on October 16, 2025

14:00 UK monthly GDP rate for the three months in August

14:00 UK merchandise trade account after seasonally adjusted August

14:00UK industrial and manufacturing output monthly rate in August

17:00 Euro zone seasonally adjusted trade balance in August

20:30 US initial jobless claims for the week to October 11

20:30 US retail sales monthly rate in September

20:30 US September PPI annual rate and monthly rate

20:30 US October monthly fee City Fed Manufacturing Index

21:00 Federal Reserve Governor Waller speaks

21:00 Federal Reserve Governor Barr delivers a speech

21:00 Federal Reserve Governor Milan speaks

22:00 US October NAHB Housing Market Index

22:00 US August zgykf.cnmercial Inventory Monthly Rate

22:00 Federal Reserve Board Governor Bowman delivers an online speech

22:30 EIA natural gas inventories from the United States for the week to October 10

00:00 EIA crude oil inventories from the United States for the week from October 10 the next day

00:00 EIA Cushing crude oil inventories from the United States for the week from October 10 the next day

00:00 U.S. the next day EIA strategic petroleum reserve inventory for the week of October 10th

Bank of Canada Governor MacCallum delivered a speech at 01:30 the next day

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